Firstly, i would check that hose. It might be corroded on the inside or full of gumf.

The head gasket can be done by removing the exhaust manifold studs and drop the exhaust. Then, diconnect and plugs (throttle pos, cold start etc.) Remove the accelarator cable. Remove fuel feed. Then remove rocker cover bolts, inside you will find 10 13mm head bolts, crack them off and remove. Lift the head off (watch the dowel's) Remove the old head gasket. Clean the surfaces then fit the new gasket. If you can, check the head for warping, use a straight edge long ways with feeler gauges and check there is no gap. If there is the head will need skimmed. Replace all parts in reverse of removing. Set the head bolds to specified torque setting (dont have this to hand) Usually till the treads are taken up then around a quarter of a turn.

Give this a try.

Might be a couple of other things to come off the head aswell, be carefull. Make sure you place the dowels back in the right place if they come out. You dont want to drop them in the oil port or water. Do an oil flush and water flush after this to obtain full efficiancy of the system.

Make sure the cooling system operates properly, im sure the fan should kick in a around 80degrees off the top of my head.